EURUSD Rebounds from Three-Years Low Bears Still in Control
EURUSD managed to rebound today after ten losing sessions in the last eleven. Weak German and European Union fundamentals pressured the common currency to the lowest level in three years. Weak industrial production from Germany also weigh on the euro. Germany’s latest GDP figures also disappointed investors showing that German economy remains the Achilles’ heel of Europe. On the other hand US Dollar benefitted from stronger economic data out of the USA. The United States Nonfarm Productivity reported last week increased to 1.4% in the fourth quarter from previous -0.2%.
Above the fundamentals a spike in coronavirus cases in China spooked investors and shift their attention to safe-haven assets.
Why EUR Decline Against USD
Euro started in weak mode the 2020, here are the reasons:
Eurozone – US interest policy divergence
US – Eurozone economic data divergence
Eurozone negative outlook for Q1 GDP
USD attracts bid as safe-haven assets amid coronavirus outbreak.
The pair is 0.12% higher at 1.0841 today as the bearish momentum is intact and traders looking for lower levels. Selling accelerated after the EURUSD pierced below the 100-day moving average.
On the upside, first resistance for the EURUSD pair stands at 1.0850 the daily top. A break above might attract more buyers for an attempt to recapture the 1.0888 the high from February 13th. Next supply zone for EURUSD will be met at 1.0925 the high from February 12th.
On the flip side, first support for EURUSD stands at 1.0833 the daily low. Next support zone stands at 1.0826 the low from February 14th. In case of a bearish breakout the pair might make a move to close the gap between 1.0774-1.0819 from April 21, 2017.